Sustainability for Profit - Vision & Sound Engineering

Sustainability for Profit - Vision & Sound Engineering

 
By Bill Lydon - Editor
 
At the recent Invensys OpsManage09 Conference, David Haft’s presentation inspired the audience by illustrating the value of sustainability with successful projects at Frito-Lay, a division of PepsiCo. These projects are examples of management with a vision and sound engineering applied to improve operations, the environment, and company profits.
 
PepsiCo’s sustainability vision is based on the high level goal, “Leave No Trace.” The strategy is to conserve and preserve the earth’s natural assets particularly water, energy and land use.   PepsiCo defined three strategic objectives:
 
  • Perpetually reduce consumption of non-renewable natural assets.
  • Step function change in consumer loyalty and customer intimacy.
  • Embed sustainability within the cultural DNA of the company.
David Haft is Group Vice President, Sustainability & Productivity for Frito-Lay and holds Bachelors degrees in Architectural Engineering and Environmental Design from the University of Oklahoma and an MBA from Marquette University. Haft has broad experience encompassing engineering, field operations, plant operations, quality assurance, environmental compliance and resource conservation. He also leads Lean Six Sigma and Autonomous Maintenance teams.  For two years, Haft has led the Environmental Sustainability initiatives for Frito-Lay. 
 
Haft started the presentation by describing the mantra of PepsiCo’s president, Indra Nooyi,“Performance with Purpose.” The three main planks of this policy are products, people and environment.
 
 
Haft described how Frito-Lay has been pursuing environmental improvements for ten years. “In 2000 we set what we call BHAGs and that stands for Big Hairy Audacious Goals (BEE-hag).”  He acknowledged that BHAG was stolen from a couple of books, “Built to Last” and “Good to Great.” The concept is setting big ambitious goals without knowledge about how they will be achieved. Haft explained that you provide time, resources, and capital to achieve the goal. Frito-Lay has achieved impressive results:
 
Reduction in...
1999 Goals
2009 Results
% of Goal
Water Consumption
Natural Gas
Electricity
50%
30%
25%
43%
35%
25%
86%
117%
100%
 
“A true BHAG is clear and compelling, serves as a unifying focal point of effort, and acts as a clear catalyst for team spirit. It has a clear finish line, so the organization can know when it has achieved the goal; people like to shoot for finish lines.” —Collins and Porras, 1996
 
Haft noted, “Commercially what is that worth?” “…had we not done this…this year we would have spent $70 million dollars more…” This is about 2.5 margin points for Frito-Lay, which Haft commented is “substantial savings and reduction of our environmental footprint.”
 
The company won EPA recognition for sustained excellence. In 2003, Frito-Lay was recognized as the industry Star of the Year by the Washington, DC based Alliance to Save Energy. In 2006, 2007, 2008, and 2009, Frito-Lay was recognized by the US Environmental Protection Agency as Energy Star Partner of the Year for Excellence in Energy Management.
 
This initiative has gone company wide within PepsiCo based on the initial experience and results of David Haft and his people.
 
Haft described specific projects and results that are impressive.
 
Projects
 
Solar Process Steam - 9,000 Lbs/Hour at 400 PSI
The SunChips plant in Modesto, California has the largest industrial solar concentrator operating in North America. Solar panels with tracking parabolic concentrators heat the water to 500 degrees. This system creates enough steam for all the production of SunChips at this plant. In addition to the cost savings, this is a great story for marketing SunChips – Chips made by the sun!
  
The solar collector field covers four acres of land with 57,969 square feet of net collector aperture area.  The solar collector field is comprised of a huge array of concave mirrors that track the position of the sun throughout the day, focusing the sun’s energy on a black tube that runs along the focus of the array. This black tube is surrounded by a second glass tube that protects it from the air, allowing it to absorb solar energy more effectively.
 
Haft commented that their work on Earth Day with Wal-Mart in 2008 allowed them to have more shelf space for their products and the resulting increased sales paid for the project.
 
LSS Thermal Efficiency
Haft heads up their lean six sigma program with 15 Black Belts and 5 Master Black Belts. One of their Black Belts did a project a few years ago using thermal mapping of production facilities looking for valve problems, steam leaks, bad steam traps, missing/bad insulation and other energy wasters. Haft said this project was “Relatively low tech but very high payback.” “Every point of efficiency at Frito-Lay is worth $1 million.” Haft explained that two years ago they were running at 85% efficiency today they are closing in on 100%.
 
Heat Recovery
During the manufacturing of cooked products there are many opportunities for heat recovery to save energy. One of Dave Haft’s favorites is “Free Fryer Heat.” 900 degree Fahrenheit oven exhaust heat from tortilla chip ovens is captured using vane boilers on the roof to generate 400 psi steam, which is used to heat oil in the fryers to fry tortilla chips. 
  
 
Free Fryer Heat is deployed at Perry, Georgia and Charlotte, North Carolina.
 
Potato Starch Recovery
Haft explained that starch is a byproduct of slicing potatoes, “that was being put down the sewer system and paying about $2 million to have processed.” They now recover the starch and sell it for about $7 million a year for paper making, pharmaceutical, food manufacturing and other uses.
 
 
Renewable Energy
 
Haft explained they are moving into renewable energy citing the following projects.
 
Biomass Boiler
In 2010, Frito-Lay will be starting up a biomass boiler at their Topeka, KS plant creating 60,000 lbs per hour of 400 psi steam for production. It is a pilot project to reduce natural gas consumption by 85 percent. A majority of the wood waste to fuel the boiler will come from the city of Topeka’s yard materials recycling center and a wood pallet board manufacturer.
 
Cogeneration – Combined Heat & Power (CHP)
Frito-Lay’s Killingly, CT plant is running a combined heat and power system since March 19, 2009 to get off the power grid. Power is generated with a 6.4 megawatt gas powered turbine and the 1,000 degree Fahrenheit waste heat is used to make all the steam required for the plant.   The system automatically reduces greenhouse gases by 5% by saving transmission losses and Nox (Nitrogen Oxide) emissions have been reduced by 60%.
 
Waste Heat Boiler
 
Turbine Generator
 
The 300,000-square-foot plant is one of the largest of Frito-Lay's 32 manufacturing sites and is considered a core facility.
 
Opened in 1980, the plant processes 250,000 pounds of corn and potatoes daily to make Lay's potato chips, Ruffles, Doritos, Fritos and Tostitos for the eight states in the greater New England area.
 
The system was funded in part with a more than $1 million grant from the state of Connecticut through the Energy Independence Act.
 
Infa-Red Oven
Firto-Lay is experimenting with infa-red technology on Tortilla ovens to increase energy efficiency.
 
Zero Landfill
Haft noted, “We are rapidly becoming a zero landfill company.” Two years ago they had a baseline of about 7% of waste was going to landfill and they set a goal to get under 1% landfill waste within 5 years. “After 2 years ten of the 30 U.S. plants are under 1% with another ten a year from now and the last ten in 2011.”    The total program will save $3-5 million. Haft explained, “rather than writing a check to have things taken away we are getting a check…” They have found buyers for much of the waste.
 
LEED Program
Frito-Lay decided a few years ago to upgrade their 13 largest manufacturing plants to achieve LEED Gold certification.
 
 The Casa Grade, AZ in now certified as LEED Gold and by 2012 all the other locations will be certified.
 
Net Zero
The Casa Grade, AZ plant is targeted to be Net Zero by taking it off the water, natural gas, and electric grid as far as reasonably possible with available technology.
 
Under construction is a membrane bioreactor with secondary filtration and purification that will purify 500,000 gallons of process water a day, meeting drinking water standards. This will reduce the outside use of 500,000 gallons of water a day to 100,000 or an 80% reduction.
 
Steam is produced by the 60,000 lb/hour biomass boiler fueled with waster from the city of Phoenix.
 
Set for completion in January 2011, the site will have a 40 acre 8 megawatt solar tracking energy system to provide electrical power.
 
Packaging Material Reduction
Frito-Lay uses a great deal of packaging and they are focused on reductions in this area. 
 
The company packs 500 million cardboard boxes a year. Now Frito-Lay reuses cartons 10 times. Carton size has also been changed to completely utilize truck space.
 
Frito-Lay produces 16 billion bags a year so small improvements have great savings. The newest development is a bag that will be introduced next year on Earth Day, made from a corn derivative that is compostable. This bag uses a 400 angstrom aluminum foil oxygen barrier. The aluminum in a square mile of this material is about the same as one Pepsi can.
 
Transportation
New trucks have an average 50% increased gas mileage over those in the existing fleet. In 2010, they will have 15 electric trucks manufactured by Smith Electric Vehicles on the road for test. The company is working on improvement for over the road trucks as well.
 
Frito-Lay has also improved overall fleet efficiency by using the UPS maintenance system for the last 5 years.
 
Sales & Marketing Benefits
Haft described that telling this story has certainly improved their visibility and created good will with customers. 
 
New Goals
Haft summed up by describing their new consumption reduction goals based on 1999 as the baseline.
 
Reductions in...
2020 Goals
Water Consumption
Natural Gas
Electricity
75%
50%
45%
 
 
In addition, the new goal for fuel reduction by their transportation fleet (based on 2004 fuel consumption) is 50%.
 
Bottom Line
Frito-Lay is creativity and productivity embraced sustainability and reaping the benefits. David Haft described how this vision has gone company wide with all PepsiCo divisions.
 
Frito-Lay is a great example for companies to follow.
 
What is your sustainability success story? Contact me to share your story.
 
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